Goldman CEO Lloyd Blankfein & Mike Bloomberg Talk Small Businesses in America

to a department store which was located on this property where this building is now and I bought a coffee pot and a small refrigerator and then I went looking for a supermarket so that I could get some coffee and milk to use those and it turns out there was no supermarket very close to this but anyways after that the next day we had four employees. One thing we did not have at the beginning was any customers, and so I'm sympathetic to those that are starting new businesses. Somebody once said you can always tell who the proprietor is at the end of the day: that's the woman or the man with the broom sweeping up after everybody else has gone home. And I will say it was an awful lot of fun, still is, but it was more fun at the very beginning where you're involved in everything and you just had that belief that it was going to work. In my experience, it took three years from when we started the company till we got our first customer. The first year was easy because she had enthusiasm; the last year was easy because you could tell that the light at the end of the tunnel was not a train coming towards you, it was really the light, this was going to work. The middle year was a little bit more complex, and that's when your family says to you, 'Well, I know you're going to do it, I know it's going to work, we have enormous confidence in you, but just in case, don't you want to take a job on the side, do this part-time?' and that sort of thing. And that's where it was tough. And I think in some senses what kept me going was I just didn't want to admit that it wasn't going to work. And so whether I thought it was going to work deep down inside, I don't know. I've never let my mind dwell on bad things. And there's one piece of advice I can give you: it's to do that, and not just in your business but in life. Don't worry about it. If there's a bad thing, get it out of your mind. If somebody comes up and smacks you right in the face, and then you feel you admit to the pain and you start screaming back, they've won twice. Don't let anybody win twice. Just suck it up, get on with it, and believe that it's going to work. Now, sometimes it doesn't work, and then you got to recover and say, 'Let's go out and do it again,' and that's fine. That's the great American dream in this country. It's one of the real differences between us and other countries: here, failure isn't failure, it's a step, it's a process, it's a learning experience. And people here today, isn't it so wonderful? 'My son or my daughter, they're on their fourth company, the first three didn't work, but they're...' and that's okay. And then you go elsewhere and one failure you're for life, and that's why more innovation takes place in America, I think, than any place else. I did want to extend a welcome to all the small business owners joining us from around the country. There is one company, it's not a small business anymore, happens to be a good customer, Bloomberg, not as big as it should be, but nevertheless, Lloyd Blankfein, whose idea this was. Lloyd and I have many things in common. We're both 6'2". It's not funny, folks. But let me tell you this, going to embarrass Lloyd, you shouldn't embarrass your customers, but I'm going to do it anyways. My first job, the first job offer I had was from Goldman Sachs and I turned them down to go to Salomon Brothers. Lloyd Blankfein was never offered a job by Goldman Sachs, even though he tried. That's a true story. He went to work, he couldn't get in, he went to work for another company, J. Aron, and that was bought by Goldman, and that's how he got into the company. Now he wound up running it, so in the end, living well is the best revenge. But nevertheless, and Dina Powell, Katherine Jalan, and Jessica Taylor, a Bloomberg administration alum, and the rest of the team at Goldman Sachs, so thank to all of you. They really have done a great job at creating and running this program, and I am glad to serve as co-chair of the advisory board. Also, in addition to Lloyd on the stage, one of the great governors in this country, the governor of Rhode Island, Gina Raimondo. She is somebody I was glad to, we were glad to support from the very beginning. We had faith in her, we thought she was going to win, we thought she'd be a great governor and do wonderful things for Rhode Island, a state that has lots of challenges like all states do, and she really has. And Bloomberg Philanthropies has been honored to work with her on a number of new programs, and we're working again together in this one. We're also glad to have with us Marco Zappacosta, the CEO of Thumbtack. His business is connecting people with workers who have the skills they need, and that's really something to understand. It's worth remembering that small businesses account for a majority of American jobs, and they really are the engines of innovation and the backbone of our economy. Most big companies, not all, but most, did start out as small companies, and so that's the incubator. If we stop that incubator, we're not going to have a future. We have every reason to help them grow, and today's a chance to do that by addressing some of the common concerns facing small businesses, from organization planning to marketing to attracting talent. We did a lot of this kind of work with our administration in City Hall; it helped us create a record number of jobs in New York City, and it's the kind of work that we have to do more across this whole country. So I want to thank the Bloomberg and Goldman employees who have taken time to volunteer here today. We really appreciate your time and your effort. A special thanks to Nanette Smith in the back there, Nanette, wave your hand. She and the philanthropies engagement team here at Bloomberg, which are helping coach the session, have been great partners with the people from Goldman Sachs who've been doing this around the country and around the world. It's a great program. I thought it's a very innovative thing. It's not one of these things that you do just to get some press. Goldman's really making a difference in our country and in our world by helping people get going, and the impact of what Goldman is doing will go on for a very long time, as some of these companies will decades from now be the big companies of the world. We have a video which we want to show you, show you what we've accomplished together. Take a look at the video, and after that we are going to have a panel with, we will all say very insightful things, gems that you should write down and remember. Thank you.

Well, we always talk about big government, but government is a very tiny percentage of where people work. They work in the private industry. Big companies started as small. Half the people in the country who work in the private sector do work for small companies. Small companies are constantly turning over as the world changes. Some of them merge, some of them keep growing, some of them sadly go out of business. Small businesses really are the intersection of where people spend their money. It's where the rubber meets the road. They can't fake it, you've got to really have a product. I've looked even at our company, Peter Grauer, who's along with Tom Secunda, has been running our company here. If you listen to them, they keep talking about we've got to have product and we've got to service our customers, and that's what everybody's got to do. And if you do that, you're going to keep creating jobs. I don't think there's any federal program that can create an enormous number of jobs, the kind of numbers that we really need in this country. It's going to have to be done by the private sector. Government has limited abilities to help small businesses. Generally, what governments do, you can argue they get in the way, they tax them. Well, we have to do that because we want to be able to have schools and hospitals and security and that sort of thing, but that is an impediment to growth. So if you can get taxes down, that helps. They tend to give you a lot of bureaucratic stuff. We do want to have licensing and tests and requirements and safety for the public to make sure people don't sell products or do things that are damaging, but it is an impediment. We've got to find ways to have government that is intelligent, tries to do its job, but at the same time understands that the solution is on the private side. And I think we've got to get away from the thought that there's something wrong with capitalism. We've, one of the problems we have in this country today is we've stopped teaching history. And I've always thought that the Bernie Sanders phenomenon, people said, 'Yeah, yeah, democratic socialism, that sounds good. It's democratic and that's socialism.' That's social media stuff, you know. We've got to have our children look to role models both in the public sector and in the private sector. And in the end, most of the heroes are going to be in the private sector. And I just wanted to take this opportunity to say the creativity that Goldman showed with this, and the great thing that would happen would be with places like Rhode Island copy it and start doing their own things. It's leverage that you really need to make this country work.

Alex, I think there are probably more open jobs than there are people looking for work by a lot. This mismatch between skill sets is something that has come out of a dumbing down of our public school system across the country. We used to be in the top 10, now we're in the top 50. It is coming from a misguided effort starting in the 60s where the zeitgeist was you have to get everybody ready for college. If they're not going to go to college, they're not going to have a career. I don't know how to break this to you, but if you have two children and one starts out going to become a welder and one starts out going to Harvard College, the Harvard kid will never catch up to the welder. Depend on the welder kid to support your family, because she or he is going to have a job. What always strikes me when I go to these fairs and you talk to, and you are at these innovation programs, and you talk to the people who are gathered around a screen and you say, 'What'd you do? What'd you build?' 'Oh, we built a great app, it lets you lock and unlock your garage door from 3,000 miles away.' And that just tells you, you got to understand that the laws of supply and demand are, if you're going to get the two together, they have to match someplace. And so what we've got to do is make sure we have vocational training in the schools, because it's very hard to outsource a plumbing job to another country. You don't have to have perfect command of the English language. What really is important is hard work. And I think that if there's one message I can give you, your businesses will be successful if you can attract and keep and engage people who have ideas and aren't afraid to tell you that, to explain that the idea you have isn't the best, maybe there's something better. And if so, you got to listen and you got to engage people. Nobody does anything that I can think of by themselves. Even an author doesn't work by herself, he, they have to work with publishers and editors and lots of other things. And so we've got to start focusing on making sure that our children are getting the kind of education that they're going to need for the world of the future, which is more technological. But also we've got to find ways to take people who are out there long past their ability to go to school, middle-aged people who are going to need jobs, and help them get to the right places and do the right things. And it's very hard. That's the cohort that is the most difficult to retrain. Very hard to go back to school when you're in your 50s, and it's very hard looking at your end of life saying, 'Wait a second, nobody's going to employ me after I'm 60, 65, or 70.' Sounds young to me. And yet I'm going to live to my 80s or 90s, and as people start living longer, we've got to figure out how they're going to be able to support themselves. Living on Social Security does not give people a warm fuzzy feeling. It doesn't let you live very well, doesn't let you live the lifestyle you've had while you work. And so that's the conundrum, and that's where government can really do some things. And I'm not a big advocate, I don't believe the federal government's going to do a very good job. I think it's the state governments that are going to really make a difference there, and the cities that are going to make a difference there, because that's where they understand what the jobs are. They don't just deal in position papers, they deal in going and talking to people. That governor walks down the street and somebody comes up and says, 'I don't have a job, you got to do something for me.' The president of the United States doesn't get to meet people who say, 'I've got to have a job.' There's just a disconnect at the federal level that does not exist at the government level, and certainly at the governor's level, and certainly doesn't exist at the city's level.

Thank you very much.